Downward pressure has continued to mount in the local Indian cold rolled coil (CRC) market with prices losing ground for the second consecutive week by INR 1,000/mt to INR 47,000/mt ($680/mt) ex-works, amid steadily falling bookings, political uncertainties, and the absence of pricing signals from producers, traders said on Tuesday, April 2.
Local CRC prices have slumped by INR 2,000/mt over the past two consecutive week indicating the depressed sentiments and negative outlook prevalent in the market, and hence few market participants - actual users or intermediaries - have been willing to conclude new deals, market sources said.
“A combination of national elections starting at the end of next week, depressed manufacturing sector growth, tighter bank credit availability, and a slowdown in key industries like automobile manufacturing and consumer durables are all casting a negative influence on the market,” a Mumbai-based trader said.
“There is also no clear indication of the base pricing strategy of domestic steel mills for current month deliveries and hence traders are not in a rush to conclude any deals,” the trader added.
Sources said that there are reports in the market that the slowdown in off-take by actual users and new bookings from traders over the past two weeks has triggered an increase in inventories at steel mills, but it is still not clear whether the latter will adjust base prices sacrificing their own margins.
$1 = INR 69.14